Financial Literacy for Kids a Big Worry for Parents, BofA Says
Teaching children how to be financially savvy is almost as important as maintaining a close relationship with family, according to Bank of America Corp.
The Merrill Lynch Affluent Insights Quarterly, which surveyed 1,000 Americans in June with investable assets of at least $250,000, found that 51 percent cited “financial know- how” as the most important life lesson to share with their children. That compares with 54 percent who named maintaining ties to family, 26 percent who said choosing the right spouse and 11 percent who mentioned staying physically fit.
“Cash and debt management, along with their children’s financial literacy, have become increasingly important to our clients as they juggle often competing financial demands while hoping to teach the next generation how to effectively manage their own money,” Dean Athanasia, head of banking and the direct investment division for Bank of America Global Wealth and Investment Management, said in a statement.
As uncertainty over jobs and long-term economic recovery increases, affluent investors are worried about rising college and retirement costs, the survey said. About 40 percent of respondents said they are concerned about the rising cost of college education and 46 percent are worried about their ability to preserve an inheritance for their children.
The study, which was conducted by Princeton, New Jersey- based marketing research firm Braun Research, found that 70 percent of respondents don’t think their retirement plan is adequate in providing for unexpected events or illness of a family member.
Job Loyalty
Retirement benefits are the No. 1 reason for loyalty among employers after compensation and promotions, with 60 percent citing those benefits as the main consideration in staying with their employer, the survey said.
More employees are moving back their expected retirement dates, with 45 percent of affluent individuals planning to retire later than planned compared with 29 percent in January 2010.
When it comes to seeking financial advice, most affluent Americans turn to financial advisers and their spouses rather than their own parents. Almost 60 percent consult financial advisers or a spouse when contemplating a financial decision, while only 12 percent turn to their parents, the survey said.
The survey was conducted for Merrill Lynch Global Wealth Management, a unit of the bank.
To contact the reporters on this story: Daria Solovieva in New York dsolovieva@bloomberg.net.
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